The Good Brigade/Getty Images; Illustration by Austin Courregé/Bankrate
- Existing-home sales in October fell 4.1 percent from September, according to the National Association of Realtors. It’s a 14.6 percent decline from one year ago.
- The nationwide median sale price is now $391,800, down slightly from September but up 3.4 percent from a year ago.
- Inventory in October stood at a 3.6-month supply, a level considered a seller’s market.
The housing market continued to challenge homebuyers and reward sellers in October, a new report by the National Association of Realtors (NAR) shows. Sales of existing homes — previously occupied properties, rather than newly built homes — continued their long downward slide, dropping 4.1 percent from September as mortgage rates climbed. The number of sales in October was off 14.6 percent compared to a year ago.
Buy/sell, rent/lease residential &
commercials real estate properties.
As has been the case throughout this year, limited inventory and low housing affordability continue to hamper home sales.
— Lawrence Yun, Chief Economist, National Association of Realtors
”As has been the case throughout this year, limited inventory and low housing affordability continue to hamper home sales,” said Lawrence Yun, NAR’s chief economist, in a statement.
Rising mortgage rates have hampered sales and could further squeeze sale activity as the year comes to a close — however, Yun and others say mortgage rates are unlikely to return to the dreaded milestone of 8 percent. “The fate of the housing market in the coming months will be dictated in part by the direction of mortgage rates, as well as the health of the broader economy,” says Mark Hamrick, Bankrate’s senior economic analyst. “The market could benefit from a combination of tailwinds, if they were to develop and are sustained, including easing inflation.”
Existing-home sales continue to decline
The existing-home sales statistic counts all completed sales of non-new-construction homes, including single-family houses, condos, townhouses and co-ops. According to NAR, the number of sales nationally declined to an annual pace of 3.79 million homes in October 2023, a drop from both last month and last year. It was the lowest level since the Great Recession year of 2010, Yun said.
Regionally, existing-home sales were once again a mixed bag. Northeast sales fell 4 percent from September and 15.8 percent since October 2022. In the Midwest, sales were unchanged for the month but down 13.9 percent year-over-year, and in the South the declines were 7.1 percent from last month and 14.6 percent from last year. The West decreased 1.4 percent monthly and 14.8 percent annually.
Days on market
Properties typically remained on the market for 23 days in October, up from 21 days in September 2023 and October 2022. Two-thirds of homes sold in October (66 percent) were on the market for less than a month, NAR reports.
Home prices rise for fourth consecutive month
The nationwide median sale price for existing homes in October clocked in at $391,800, up 3.4 percent from October 2022 and the fourth month in a row to record year-over-year increases, Yun says. In June 2022, the median price hit its highest-ever recorded price at $413,800. The U.S. housing market had been on a remarkable run of 131 consecutive months of year-over-year median sale price increases — the longest-running streak since NAR started keeping records — before dropping year-over-year in February of this year.
All four major regions once again saw price increases in October. The West continues to have the highest median price by far at $602,200, up 2.3 percent from a year ago. In the Northeast, the median rose 7.5 percent from a year ago to $439,200. The South’s median price rose 3.5 percent to $357,700, and the Midwest’s median rose 4.2 percent to $285,100.
Housing inventory remains low
Total housing inventory — the overall number of homes on the market for sale — sat at 1.15 million units at the end of October. That’s a modest increase from September but down 5.7 percent from a year ago. And it represents only a 3.6-month supply, which is still well short of the five to six months typically required for a healthier, more balanced market.
The sharp rise in mortgage rates has kept many homeowners from selling, which keeps existing homes off the market. Those who locked in rates at 3 percent several years ago aren’t keen on moving while rates are so high. “Rate lock is still in effect, with current mortgage rates sitting above 7 percent and the majority of outstanding mortgages sitting under 4 percent,” says Zillow senior economist Nicole Bachaud.